Absolutely not. Contribution agreements are a vehicle that governments, going back as far as I can remember, have used to achieve public policy purposes in a transparent way that is subject to audit, which this agreement was and is. They are a standard vehicle.
There are standard provisions in contribution agreements. They will vary from case to case, depending on the nature of the program being delivered. They are absolutely a proven vehicle, and there is nothing unethical about using a partnership agreement with a third party to achieve public policy and public administration objectives—none whatsoever.